A Tragedy of the Clubs: Excess Entry in Exclusive Coalitions

42 Pages Posted: 31 Mar 2000

See all articles by Paola Manzini

Paola Manzini

University of St. Andrews - School of Economics and Finance; Institute for the Study of Labor (IZA)

Marco Mariotti

University of Exeter Business School - Department of Economics

Date Written: July 1999

Abstract

We model club formation as a non-cooperative game of coalition formation and surplus division. We show how social norms and individual rationality sustain a particular form of collective inefficiency, namely excessive entry in the joint production and exploitation of an excludable good. We term this phenomenon the "tragedy of the clubs". The tragedy of the clubs is a pervasive equilibrium phenomenon.

Keywords: clubs, coalition formation, multiperson bargaining

JEL Classification: C78, D71

Suggested Citation

Manzini, Paola and Mariotti, Marco, A Tragedy of the Clubs: Excess Entry in Exclusive Coalitions (July 1999). FEEM Working Paper No. 58.99. Available at SSRN: https://ssrn.com/abstract=200629 or http://dx.doi.org/10.2139/ssrn.200629

Paola Manzini (Contact Author)

University of St. Andrews - School of Economics and Finance ( email )

North St
Saint Andrews, Fife KY16 9AJ
United Kingdom

HOME PAGE: http://www.st-andrews.ac.uk/~pm210/

Institute for the Study of Labor (IZA)

P.O. Box 7240
Bonn, D-53072
Germany

Marco Mariotti

University of Exeter Business School - Department of Economics ( email )

Streatham Court
Rennes Drive
Exeter EX4 4RJ
United Kingdom
+01392 263219 (Phone)
+01392 263242 (Fax)

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